v dcvs (Software) (112 Points)
21 July 2012
Five year lock in taxsaver Fd wad made on march'2011.
Now, for the period of April'2011-march'2012 bank
has creditet interst.
Now, do i have to show interst incureed in the return i.e in assessment year 2012-2013 or can i
show total interst on maturtity i.e in march 2016.
Thnx in advance
Shenba Associates
(Partner)
(115 Points)
Replied 22 July 2012
Devendra Singh
(Chartered Accountant)
(487 Points)
Replied 22 July 2012
You can show it in your return either on accrual basis or at the time of receipt...if the bank has credited the interest and deducted TDS on it (if interest exceeds 10000), then better show it in current year to claim tax credit).
Rammohan
(NA)
(245 Points)
Replied 24 July 2012
It seems that you have opted for periodic interest payment (by asking the Bank to credit the interest on this special FD, in your savings bank account at fixed intervals), on your 5-year deposit made in March 2011. Then it is necessary for you to show the interest on this FD in the FY in which you received the credit, in your tax return every year.
If you had opted for the cumulative scheme on your FD, then you have the choice to either show the accrued interest (which figure you can obtain from the Bank in April every year) in your tax return every year OR to show the total interest earned for all the 5 years in the FY in which you redeem the FD. However, you have to follow a consistent practice in this regard every year, also taking into account how you show the interest accrued on your other similar bank deposits placed on cumulative basis.
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